Funds Disbursement Guidelines Economic Support Funds

February 15, 1984

LETTER OF INSTRUCTIONS NO. 1379

ESTABLISHING FUND DISBURSEMENT GUIDELINES TO GOVERN THE EFFICIENT UTILIZATION OF THE DEVELOPMENT PROJECTS FUND (ECONOMIC SUPPORT FUND)

Pursuant to the provisions of LOI 1030 creating the Development Projects Fund and LOI 1377 creating the Provincial Development Fund and the PROFEM, the following fund disbursement guidelines to govern the efficient utilization of Development Projects Fund are hereby established:

1. The Development Projects Fund hereinafter called "The Fund" shall be composed of all Economic Support Fund (ESF) proceeds made available to the Philippine government under the Military Base Agreement of 1947, as amended, and under any subsequent amendments thereto.

2. The Fund shall be treated as a capital fund with the characteristics of a combined corporate investment/revolving fund under the direct administration of the Management Advisory Committee through the DPF Secretariat (DPFS) created under LOI 1030. As such, the Fund shall be exempted from the provision of Secs. 40, 50, 51, 52, 53 and 55 of P.D. 1177.

 Subject to Management Advisory Committee's approval, the Fund can be invested and reinvested to financially and economically viable projects, provided that the returns or any income derived are to be used to further support local or national programs.

3. The Fund shall be held in custody for the Management Advisory Committee through the DPFS under an account with the Philippine National Bank. Releases from the Fund shall be made in accordance with the approved guidelines jointly established by DPFS and rest earnings of the account may be utilized to support the operations of the DPFS and any confidential instructions of the President or the MAC Chairman.

4. Projects eligible for financing under the Fund shall include:

a) Equity matching with provincial/city/municipal government for economically viable projects, e.g., food processing, wood chips, etc.;

b) Lending to provincial/city/municipal governments and/or government-supported economically viable projects, e.g., public market, slaughterhouses, etc.; and

c) Grants/subsidies to welfare and other social projects of the national/regional and local government units e.g., school buildings, water-impounding, roads, etc.

5. All projects to be financed under this Fund shall be passed upon by the MAC and submitted to the President for approval.

DONE in the City of Manila, this 15th day of February, in the year of Our Lord, nineteen hundred and eighty four.